Data Center

How Delaware Embraces Data Center as a Service

DCaaS provides the state with modern infrastructure and flexibility for the future.

Mike Gruss has more than a decade of experience reporting on local, state and federal governments, including national security space programs.

Delaware’s IT leadership team faced a familiar conundrum with its mainframe: How could the state modernize aging technology without making a massive capital investment?

The challenge was compounded by an aging workforce and an enterprise that, with inaction, risked becoming obsolescent.

Enter the state’s CIO, Gregory Lane. Having previously worked in the private sector, Lane had experience implementing an outsourcing model, in which a third party takes over full data center operations. But that kind of wholesale handoff didn’t offer the flexibility Delaware needed.

Instead, Lane and his team turned to Data Center as a Service (DCaaS), a model that moves away from the traditional, on-premises approach and into a hybrid environment. In this setup, critical workloads are managed through a mix of third-party providers and cloud services. The goal has been to modernize operations, reduce risk and set up Delaware’s IT for long-term sustainability.

“I like to think of it as modernizing not by turning over our entire data center to someone else, but by moving many services outside our data center and working with others to help manage them alongside our own talent pool,” Lane says.

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Why Delaware Made the Move to DCaaS

The motivation for Delaware’s shift to DCaaS came from several fronts.

First, the Delaware Department of Technology and Information — with a goal of providing centralized IT services for state agencies — was running on outdated hardware, some of it 10 to 20 years old. Capital investments to replace such infrastructure can be difficult to secure in state budgets. But by moving to DCaaS, the department was able to have the flexibility of operating its own data center with the resiliency that comes from third-party assistance.

“We were able to leapfrog into a more modern environment, at least in terms of our equipment,” Lane says.

Delaware’s IT leaders also recognized that the state’s workforce was evolving. Many systems had been built and maintained by staff nearing retirement, making it harder to sustain those systems — including the mainframe that some agencies still use to provide services to the state’s citizens — over the long term.

By transitioning those functions to an external provider, the state ensures uninterrupted operations.

“Already, we're seeing people with mainframe expertise retire, and it’s impacting us less than it would have if we hadn’t made the move,” Lane says. “The skill sets we’re looking for now are more sustainable than relying on people who understand anchoring technology.”

With DCaaS, Delaware maintains operational oversight while leveraging cloud platforms such as Microsoft Azure and other providers to host and manage critical infrastructure.

Already, we're seeing people with mainframe expertise retire, and it’s impacting us less than it would have if we hadn’t made the move.”

Gregory Lane CIO, Delaware

IT Team Builds Resilience and Flexibility With DCaaS

Another benefit for Lane’s team has been enhanced resilience.

Delaware’s IT leaders sought a more robust disaster recovery strategy. Today, workloads are distributed across multiple platforms and physical locations along the East Coast and Midwest — not just within Delaware. This improves redundancy and allows for quicker disaster response.

“It gives us much greater flexibility and a different kind of impact in the event of a disaster,” Lane says. “It doesn’t affect everything, just the workload at hand.”

The new setup also supports a hybrid workforce. With more systems in the cloud, staffers no longer need to be onsite to monitor or manage services; much of that work can now be done remotely or with the help of partners.

“I can’t say that we had a 100% mirror of our production environment during failover testing in the past,” Lane says. “Now we do. We’ve made huge strides in disaster capability. Instead of operating with reduced resources, we now have full capacity, and it happens faster and more easily.”

Delaware is not alone. According to the 2024 State CIO Survey from the National Association of State Chief Information Officers, 77% of state CIOs said they are contracting for third-party or off-premises cloud solutions to improve disaster recovery from both natural and man-made events.

EXPLORE: States can navigate budget uncertainty through IT modernization.

DCaaS Grants Agency Autonomy and Future Flexibility

Beyond improvements for the central IT team, DCaaS gives state agencies the flexibility to modernize at their own pace. Some agencies continue building capabilities on the mainframe, while others have transitioned off entirely.

“If I didn’t make this move, we’d be pressuring them to get off the mainframe because we’re struggling to support it,” Lane says.

As virtual server workloads migrate to Azure, Delaware is gaining access to a wide array of new capabilities, thanks to Microsoft’s ongoing investments — features that would be difficult, if not impossible, to replicate in an on-premises environment.

“You get the benefit of investments that a company such as Microsoft makes, investments we couldn’t match,” Lane says. “You gain new capabilities as they develop them. That’s sometimes hard to explain when people start to look at the bill.”

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